What is position sizing?

Position sizing determines how many units (shares, lots, or contracts) to buy or sell on a trade. Correct sizing ensures that if your stop-loss is hit, you lose only the predetermined percentage of your account — protecting you from catastrophic losses.

What risk percentage should I use?

Most professional traders risk between 0.5% and 2% per trade. Risking more than 2% per trade dramatically increases the chance of a large drawdown. Beginners are often advised to start at 1% until they have a proven strategy.

How is the position size calculated?

The dollar risk is: Account Balance × (Risk % / 100). The risk per unit is: |Entry Price − Stop-Loss Price|. Position size in units = Dollar Risk ÷ Risk Per Unit. If a commission is entered, it is subtracted from the available dollar risk before dividing.

Does this work for forex and crypto?

Yes. Enter prices in any currency pair or coin price. The result is the number of units (base currency units for forex, coins for crypto). For forex standard lots, divide the unit result by 100,000.

What is the risk-to-reward ratio shown?

The risk-to-reward (R:R) ratio compares how much you stand to gain versus how much you risk. If your target is entered, R:R = |Target − Entry| ÷ |Entry − Stop-Loss|. A ratio of at least 2:1 is commonly recommended.

Position Size Calculator

Enter your account balance, risk percentage, entry price, and stop-loss to get the ideal position size in units and dollars.

Trade Parameters

Account Balance

Risk Per Trade

Entry Price

Stop-Loss Price

Target Price (optional — for R:R)

Commission Per Trade (optional)

Fill in your trade parameters to calculate position size.

Recommended Position Size

units

Dollar Risk

$0.00

1% of balance

Risk Per Unit

$0.00

entry − stop

Risk : Reward

—

add target for R:R

Trade Breakdown

Account Balance	—
Risk Amount	—
Entry Price	—
Stop-Loss Price	—
Target Price	—
Commission	—
Stop Distance	—
Position Size (units)	—
Total Trade Value	—

Risk Level Conservative

0% 2% (standard) 10%+

Summary

Enter your account balance, risk percentage, entry price, and stop-loss to get the ideal position size in units and dollars.

How it works

Enter your total account balance in the Account Balance field.
Set the percentage of your account you are willing to risk on this trade (typically 1–2%).
Enter the price at which you plan to enter the trade.
Enter your stop-loss price — the price at which you will exit if the trade goes against you.
Optionally enter a target price (to calculate risk-to-reward ratio) and commission per trade.
Read the recommended position size in units, the maximum dollar risk, and the risk-to-reward ratio.

Use cases

Sizing stock trades so a single loss never exceeds 1–2% of your portfolio.
Determining base currency units for forex positions based on account equity and stop loss distance.
Determining how many shares or contracts to buy given a defined stop-loss level.
Comparing position sizes across different entry and stop-loss scenarios.
Teaching proper risk management to new traders.
Quickly verifying that a planned trade fits within your daily risk budget.

Frequently Asked Questions

Last updated: 2026-09-14 · Reviewed by Nham Vu